World Feed Market
11 October 20138 min reading
It is estimated that world mixed feed production has increased 65% in the last 20 years. According to International Feed Industry Federation (IFIF); world mixed feed production is rapidly approaching one million tons. Total mixed feed production in Turkey is around 13,1 million tons.
Many grain products such as wheat, corn, barley, oat, millet have strategic importance in the world. Produced by being cultured by humans since the ancient times, these products are extremely important resources in terms of animal nutrition just like human nutrition. Animal feed is the second mostly used field in which these grains are used after human nutrition.
Qualified as the most important factor that affect efficiency and profitability directly in livestock raising, feeds is divided into two groups in itself. While feeds with low digestible nutrients and high cellulose ratio like alfalfa and hay obtained from meadows and pastures are defined as roughage; feeds formed by being processed and blended of grain and pulse varieties with high amount of digestible nutrients in unit weight are defined as mixed (concentrated) feed in general. And our main focus is on these mixed feeds obtained by processing of grains. These feeds meet the most important part of basic nutritional needs of animals both in sheep & goat farming and cattle livestock, both in winged and other poultry, both in fisheries group and group of pets.
Grains (barley, wheat, rye, millet, oats), oilseed residues (sunflower, nut, cottonseed, soybean residues), animal originated proteins (fish, meat and bone, blood meal, poultry and slaughterhouse residues, bone meal), mill residues (wheat cracks, middling [razmol], bran, rice bran, red dog), beer factory waste (malt grass, malt powder), selector bottom pulses (lentils, beans, etc. cracks) and additives (vitamins, minerals, molasses, salt, marble dust, limestone chemicals) are used in mixed feeds produced for cattle, sheep and goats.
For poultry feed production; grains (barley, wheat, rye), oilseed residues (sunflower residues, cottonseed, soy, peanut and nut residues), animal originated proteins (fish, meat and bone, blood meal), energy resources (vegetable oils) and additives (vitamins, minerals, premixes, chemicals) are used.
WORLD MIXED FEED PRODUCTION
Mixed feeds have a long history in the world production. The first industrial production of mixed feed was started at the end of 1800s in Missouri USA and the same facility still continues to production. The first arrangements for mixed feed sector in the world were made between 1916 and 1920.
Mixed feed production in the world is intensified in South America, Asia and EU. USA is the largest producer that meets 23,6 % of world mixed feed production. With 10 % China and with 6,4 % Brazil follow USA.
According to 2003 data; world mixed feed production is around 612 million tons. 35 % of this production is used for winged poultry, 31 % for pigswill, 26 % for dairy and livestock feeds, 8 % for other animal species. These feeds are produced in powder feed, pellet feed and granule feed forms.
It is estimated that world mixed feed production has increased 65 % in the last 20 years. According to International Feed Industry Federation (IFIF); world mixed feed production is rapidly approaching one million tons. Stating that global food production for commercial purposes has a turnover of over U.S. $ 370 billion; IFIF announced that there is a worldwide increase in demand for animal protein from livestock and dairy farming, and fishing areas. IFIF states that there is an increase in the productions of the countries that are especially developing and growing consistently.
Reporting that 2012 was a hard year for the feed industry due to the decreasing feed productions in US (1,5% decrease) and (3 % decrease), IFIF states that the growth in 2013 depends on global grain production, biofuel policy and export demand. Foreseeing 2% growth for the industry in the global scale, IFIF thinks that there will be a stronger growth in the feed sector for pets and fisheries.
MIXED FEED PRODUCTION IN TURKEY
According to the data of Food, Agriculture and Livestock Ministry; Turkey’s total mixed feed production that was 9,5 million tons in 2008 reached 13,1 million tons in 2011. The largest share in total mixed feed production belongs to cattle and sheep and goats feeds. Cattle and sheep and goats feed production that was 7,2 million tons in 201 is followed by poultry feeds with 5,5 million tons.
Figures of mixed feed production that was realized between 2008 and 2011 are indicated in the table by taking records of Food, Agriculture and Livestock Ministry into account. These figures represent the invoiced official figures reported to the Ministry. Thus; in addition to the 13,1 million ton-mixed feed that is the registered feed amount in Turkey in 2011, mixed feed producers that make productions for themselves and non-invoiced sales in the sector should be taken into consideration. In this case; it is said that Turkey’s mixed feed production is over 15 million tons.
TURKISH FEED SECTOR
According to the data of “Current Status and Projections of Feed, Meat and Dairy Sectors in the World and Turkey Report” prepared by Turkey Dairy, Meat, Food Industrialists and Producers Association (SETBIR) in March 2013; 30 % (24,4 million hectare) of land area of Turkey is cultivable. 67,8 % of agricultural lands (16,3 million hectare) in Turkey (excluding fallow lands) is separated for field agriculture. Grain is cultivated on 74,2 % (12,1 million hectare) of this area. Wheat ranks first with 66,9 % share, barley ranks second with 25,1% and corn ranks third with 4,9% in the entire grain cultivation land. Rye, rice, oats and triticale follows these products in order.
Food is associated with feed in the world now. The relation between food and feed in the international arena is sloganized with “Feed to Food” phrase. Turkey’s starting negotiations of Food Safety, Phitosanitary and Veterinary Act within European Union membership process and continuation of harmonization studies make feed sector even more important for Turkey as mixed feed is one of the major topics in harmonization package for livestock.
The first initiative on mixed feed industry in Turkey was started by the private sector in 1955. Inıtiative in real terms was realized with the establishment of Yem Sanayi Türk A.Ş. in 1956 under the leadership of the government. Operationalizing its own facilities, the aforementioned company established 26 facilities in partnership with the private sector.
Feed mills of the private sector started to be established as of 1965. Completing its mission of being a pioneer, Yem Sanayi Türk A.Ş. withdrew from the sector in 1996 by selling all feed mills within the scope of privatization. The entire mixed feed was started to be produced by the private sector after this year. Numbers, capacities and capacity usage rates of the mixed feed mills by years are indicated in the table below.
Active mills in Turkey are mainly located in Aegean and Marmara regions; Central Anatolian Region follows them. It is said that 61,7 % of total active feed mill numbers in Turkey in 2010 consists of facilities with capacities lower than 10 tons/hour. The rate of facilities with 11-20 tons/hour capacity is 26,2 % and the rest 12,1 % belong to the facilities with capacity over 20 tons/hour.
83,4 % of inactive facilities, in other words the closed ones are the ones with capacity lower than 10 tons/hour. Thus the new facilities in the sector prefer to establish high capacity mills.
FEED PRICES IN TURKEY
Mixed feed prices in the sector were determined by the Government after Feed and Forage Act Regulations numbered as 1734 were put into force, but the prices have been formed in competitive market conditions after the decisions taken on 24 January 1980.
Feed industry is an intermediate sector. It takes its inputs mainly from crop production and presents its production to livestock production. Due to this feature, feed prices are affected from two factors. One is raw material prices and the other one is animal product prices.
Feed prices increase as the feed raw material prices increase.
FEED PRODUCTS TRADE IN TURKEY
The raw material production amounts used in mixed feed and the increases in mixed feed production figures have not been realized in the same amounts in Turkey. It is seen in Turkey that the growth speed of especially oilseeds and their residues with protein source and feed raw materials that are energy source like corn is quite behind the mixed feed industry development speed. Thus import is applied in order to cover the deficit. Dependence on import causes problems in the feed sector in terms of taking costs under control and adversely affects the competition force of the sector in the international market.
In the SETBIR report; it is especially emphasized that mixed feed industry in Turkey is not having a consistent year in getting raw material supply in terms of both price and amount. It is stated that turnover of mixed feed sector in Turkey is approximately 5,8 billion dollars and nearly 3 billion dollar-amount of this amount is realized via import. Especially the amounts paid for corn, oilseed residues, soya bean and its residues and barley are huge amounts.
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